Only after the news is out does management turn its attention inward, usually relying on the more traditional channels for informing employees. Too often a company will focus on communicating a merger or acquisition to such external constituencies as the media and Wall Street analysts. 6. Intentional and consistent messaging can cultivate a unified company culture. hbspt.cta._relativeUrls=true;hbspt.cta.load(99128, 'b65a84a8-3072-4f48-832e-1203b9fa8d49', {}); Uncover engagement obstacles and opportunities, Leadership Approaches for Communicating a Merger to Employees, What leadership approaches will be effective in leading a merger. And that is just one issue to worry about! For entrepreneurs, business owners and C-suite executives, a rise in M&A activity means they could be part of a deal in the near future. (4) Provide the tough information during and after integration. If employees are kept in the dark or lied to, even unintentionally, many will choose to leave. The change of scenery can decrease anxiety and increase humility. When executive teams fail to acknowledge change, it can be difficult for HR to align and engage employees. Good communication practices in the post-merger period are: Recognize that all merger goals depend on communication. Legal regulations can make it difficult for executives to be transparent, but when management haphazardly says that "nothing will change" in an effort to keep employees motivated, trust will be damaged when things do, in fact, change. According to Deloitte's 2018 M&A Trends Report, this was not surprising: "Corporate and private equity executives foresaw an acceleration of merger and acquisition activity in 2018.". Only after the news is out does management turn its attention inward, usually relying on the more traditional channels for informing employees. In a startup, the people on the ground have helped build a successful brand from nothing. Effective communication is an imperative element of mergers and acquisitions. When it comes time sell your company, one of the toughest issues is communicating the process to employees. Frequent communication reduces uncertainty and maintains a trusting relationship with employees. These all reflect the main goal: to ensure that the right message about the merger is communicated consistently. You can’t keep individuals from trying to gain the upper hand. Before long, however, as systems and processes are overhauled, those employees realize they have been fed a “party line.” Many mergers need to be approved by local governments, attorneys … Make a note at the end of the letter directing your employees to your HR person or department should they have additional questions or concerns. ... At Bank PHB, pre-merger communication “was first restricted to the . The leadership approach: Build better relationships. Why survey after a merger or acquisition? Your merger and acquisition letter to your staff should include the following (in this order): The first part of your letter should be the announcement of the merger/acquisition. As a result, excitement about the future and long-term engagement can be difficult to maintain. Communicating changes to the employees Business communication is crucial for every company’s success, and this is especially true when big changes are happening. This is a communication task. As frequently mentioned by researchers and practitioners, many mergers and acquisitions (M&A) fail to achieve their expected results. Think about what each audience needs to hear and how it would be best delivered. The announcement of merging companies is usually kept private until the m&a deal is signed. Provide a 1-800 number, HR email address or a private, HR specific Facebook page to field questions, share information or connect with your employees. There should also be a contingency plan in place for unexpected events. Giving employees a voice A merger or acquisition could easily go one of two ways for employees: it might offer opportunities for growth, or it could introduce redundancies and lead to layoffs. Communicating the shared vision and goal of the transaction will help employees and other stakeholders to understand and accept the deal. The leadership approach: Develop a communication team. At a large corporation, efficiency and operations depend on the support of thousands of individuals. To: All Employees From: Senior VP . What do they sell?) But when one entity is more dominant, people may believe there are winners and losers. Address these issues upfront – even the uncomfortable ones – by describing any immediate changes that will affect employees. Employee morale will take less of a hit if they feel they are kept in the loop. Uncertainty due to poor communication will not only lead to time-wasting rumors, it will also impair employee engagement, reduce motivation and work quality, and ultimately impact the company's bottom line. Others will become invested in the potential that lies ahead. Employee survey questions to use post-merger or acquisition 4. Employee Communication During Mergers and Acquisitions provides a blueprint for your internal communication during a merger or acquisition, it contains checklists, examples and tables to help busy communication and integration teams by providing them with practical guidance and examples of what they should consider. Most M&A financial models include a retention plan line item, ... at communicating its vision for the new combined entity and how the combination is actually beneficial to the employees through growth and/or sustained viability. Whatever the case, share it with your employees so they understand your goals for these changes. This kind of communication engages employees and helps give them a sense that the changes have emerged from the organization as a whole, not imposed on it from on high. Listen to why Lindsay’s first duty is to understand the new audience, and what a good communications blend that drives business results and motivates employees looks like. Typically the senior management is accountable for breaking the news, but most of the questions are going to be asked to team leaders as the employees are most likely to … Example 3: Company merger letter. Communication challenges are one of the top factors that cause company synergies to fail in mergers and acquisitions. Now that you know what to include in your letter, here are some great samples to follow: Mergers and acquisitions can be great ways to accelerate growth, but when they fail to produce the desired result, a common factor is poor communication, including a lack of information during the pre-merger period and a lack of post-merger cooperation and coordination. Early, frequent communication following merger has impact EXAMPLE Change in mean from pre-merger benchmark Control plant – no communication until formal announcement of organizational changes Experiment plant – early, frequent communication during planning process Stress – 9% less Uncertainty – 22% less Intention to remain – 6% higher 4 5 6 4 3 3 5 Mean Mean Mean 2 2 M Integrate the employee communication strategy with the communication strategy for other stakeholders—customers, suppliers, government leaders and the community. management consultant believes that over-communicating in a merger or acquisition is good. Example 3: Company merger letter. The second task in mergers—adapting to changed operating models, such as new structures, processes, and governance—poses some of the most visible and difficult issues for employees. Concerned employees might lose productivity, increase stress, or choose to leave the organization. Take Care of Employees. In the next section of your letter, explain the "why" behind the merger. Transaction effective date 3. In an effort to prevent your best employees from leaving, share information early and often. Give employees a time frame, if possible, on when they will receive that information. Company Name or Letterhead Address City, State Zip. Here are some common emotions and leadership approaches to begin communicating a merger to employees. Employees have to be persuaded to believe in the corporate vision and to act to bring it about. Escape rooms or improv workshops help build a collaborative spirit. Dear Fellow Employees: We are in the process of making a number of changes in our worldwide manufacturing operations that will require us to establish an after-tax profit reserve of about $555,000,000. You need to inject accurate information throughout your workforce. Consider an activity that requires problem-solving. Brainstorm team building activities outside of the office. Communication challenges came out as one of the top factors that caused company synergies to fail. In most courses studied at Harvard Business schools, students are provided with a case study. Details about the companies 2. 1 Too often a company will focus on communicating a merger or acquisition to such external constituencies as the media and Wall Street analysts. Excited employees can serve as your best chance to get as many employees on board as possible. $ 85 billion communications, on when they will receive that information between what a company will on... 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